China, the world’s second largest economy, is feeling the economic impact of the Coronavirus.
Chain’s coal consumption usually trends lower into the Chinese New Year, but then recovers. What is happening is that their daily coal consumption has flatlined, underscoring the impact of the Coronavirus.
Massive Manufacturing Disruptions Due to Coronavirus Include iPhone
About 80% of world goods trade by volume is carried by sea and China is home to seven of the world’s 10 busiest container ports, according to the United Nations Conference on Trade and Development. Nearby Singapore and South Korea each have a mega port too.
“A closure of the world’s manufacturing hub impacts container shipping at large, as it is a vital facilitator of the intra-Asian and global supply chains,” said Peter Sand, chief shipping analyst at BIMCO, an international shipping association. “This will affect many industries and limit demand for containerized goods transport,” Sand told CNN Business.
Alibaba Warns Virus Having Broad Impact on Chinese Economy
“Alibaba, the first major Chinese technology corporation to report results since the epidemic emerged in January, said the virus is undermining production in the economy because many workers can’t get to or perform their jobs. It has also changed buying patterns with consumers pulling back on discretionary spending, including travel and restaurants.” Wyndham has closed 70 percent of their hotels in China.
And more cities are being locked down.
China Locks Down Hangzhou, Mega-City Far From Epicentre of Coronavirus
HANGZHOU: Millions more people have been ordered to stay indoors as China battles to curb the spread of a new virus that authorities said on Wednesday (Feb 5) has already killed 500 people.
Hangzhou, capital of Zhejiang province and home to Alibaba Group, recorded an estimated population of almost 10 million by the end of 2018, according to a metro newspaper owned by Hangzhou Daily Press Group.
Yet stocks are at all-time highs.
Stocks are behaving as if week 17 hosted the ICL. 17 weeks would be early for an ICL. But stocks did form a weekly swing high, break the weekly trend line and close below the 10 week MA on week 17. With the Fed is engaging in Repo operations and central banks are flooding the market with liquidity, in part, to lessen the impact of the Coronavirus — that may be all of the correction that we will see. But the longer it takes to bring the Coronavirus under control, the more severe the reaction will be once the economic effect starts to get priced in. There already are bearish divergences developing on the weekly oscillators, which often precede a cycle top. If stocks close below the 3330.00 break out level that should send stocks into their intermediate cycle decline.